Every year, thousands of new limited companies register in Scotland. The process is managed by Companies House, which operates a dedicated Scottish office in Edinburgh and maintains the same rules across the UK. If you are planning to trade as a company rather than a sole trader or partnership, this guide explains what you need to do.
A limited company is a separate legal entity from the people who run it. The company can own assets, enter contracts, and incur debts in its own name. Shareholders are liable only for the value of their shares. Directors have legal duties to the company and its members.
Before you register, decide whether a limited company is the right structure for your circumstances. Sole traders, partnerships, and limited liability partnerships are alternatives. A solicitor or accountant can advise on which is most suitable.
Step one: choose a company name
Your company name must not be identical to an existing registered name and must not contain sensitive words without permission. The Companies House name availability checker on the gov.uk website lets you search the register before you submit.
Certain words are restricted. “Royal”, “National”, “British”, “Scottish”, and “Bank” all require specific approval or evidence to use. A full list of sensitive words is published by Companies House.
If you want to trade using a different name from your registered name, you can use a business trading name without separate registration, but you must disclose the registered name on invoices, receipts, and formal correspondence.
Company names in Scotland can be registered in English or Gaelic. Scottish names must end with “Limited”, “Ltd”, “Public Limited Company”, “PLC”, or the Gaelic equivalents “Earranta”, “Earr”, “Coimpeanaidh Phoblach Eearranta”, or “CPE”.
Step two: choose your registered office address
Every UK company must have a registered office address. For a company registered in Scotland, this address must be in Scotland. It is the official address for legal documents, including correspondence from Companies House and HMRC.
The registered office must be a physical address in Scotland, not a PO Box. It can be a residential address, a serviced office, or your accountant’s premises if they offer this service. The address will appear on the public register.
If you use a home address, it will be visible to anyone searching Companies House. This is a consideration for many founders. Serviced office providers across Glasgow, Edinburgh, Aberdeen, Dundee, and other Scottish cities offer registered office services for a monthly fee.
Since 2024, Companies House has tightened rules on registered office addresses. The address must be one where the company or its agent can acknowledge receipt of documents. Ghost addresses at premises with no physical link to the company are no longer permitted.
Step three: appoint directors and shareholders
A private limited company requires at least one director. The director must be at least 16 years old. There is no requirement for directors to live in Scotland or the UK, though directors must provide a service address that can receive legal documents.
Directors have statutory duties under the Companies Act 2006, including duties to act in the company’s interests, avoid conflicts of interest, and maintain accurate records. Breach of these duties can result in personal liability, disqualification, and in serious cases criminal prosecution.
You must also have at least one shareholder. A single person can be both the sole director and sole shareholder. When you register, you specify the share structure, which can be as simple as one share held by one person or more complex arrangements involving multiple share classes.
Since the introduction of the Economic Crime and Corporate Transparency Act 2023, Companies House has been implementing enhanced identity verification for directors and people with significant control. The rollout continues in phases. Check the gov.uk guidance for current requirements.
Step four: prepare your memorandum and articles of association
The memorandum of association is a short document stating that the subscribers wish to form a company and agree to take at least one share each. Companies House provides a template.
The articles of association are the company’s internal rulebook, covering matters such as how directors are appointed, how shares can be transferred, and how decisions are made. Most small companies adopt the model articles published by Companies House. These cover the standard situations adequately.
If your company has particular requirements, for example a shareholders’ agreement that differs from the standard model, you will need bespoke articles. A solicitor can draft these, but the cost is usually only justified for companies with multiple shareholders or specific governance arrangements.
Step five: submit the registration
You can register online through the Companies House web service. The standard online registration costs £50 and is typically processed within 24 hours.
Paper registration using form IN01 costs £71 and takes eight to ten working days. A same day service is available for £78.
You will need to provide the proposed company name, the registered office address, details of directors including date of birth and residential address (not public), details of shareholders, the share capital structure, and details of people with significant control over the company.
Most online applications are approved without issue. Rejections usually relate to name conflicts, sensitive word issues, or incomplete director information.
Step six: post registration obligations
Once your company is registered, you must do several things quickly.
Register for Corporation Tax with HMRC within three months of starting to trade. The company’s Unique Taxpayer Reference will be issued automatically after incorporation.
Open a business bank account. While not legally required, operating company finances through a dedicated bank account is practical and expected by HMRC.
Consider VAT registration. You must register for VAT if your taxable turnover exceeds the current threshold of £90,000 in any rolling 12 month period. Voluntary registration is also possible.
If you will employ staff, register as an employer with HMRC and set up PAYE before the first payday.
File a confirmation statement every 12 months. This confirms the information held on the register is still accurate and costs £34 online.
File annual accounts with Companies House. Small companies have simpler filing requirements than larger businesses. Accounts must be filed within nine months of the end of the accounting reference period.
File a Corporation Tax return with HMRC within 12 months of the end of the accounting period. Corporation Tax itself is due nine months and one day after the accounting year end.
